William Shoriwa and Others v Bevpak (PVT) LTD

### Preamble
IN THE LABOUR COURT OF ZIMBABWE
JUDGMENT NO. LC/H/737/2014
HARARE, 13 OCTOBER 2014
CASE NO.
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IN THE LABOUR COURT OF ZIMBABWE      JUDGMENT NO. LC/H/737/2014

HARARE, 13 OCTOBER 2014		     	            CASE NO. LC/H/412/14

AND 07 NOVEMBER 2014

In the matter between:-

WILLIAM SHORIWA					1st Appellant

And

THOMPSON MUGONI					2nd Appellant

And

CLEOPAS MUGONI					3rd Appellant

And

BEVPAK (PVT) LTD					Respondent

Before Honourable L. Kudya, Judge

For Applicant		-	L. Maoneka (Unionist)

For Respondent		-	B. Diza (Legal Practitioner)

KUDYA, J:

This is an appeal against the arbitrator’s decision where she dismissed the now appellants’ claim for gratuity in circumstances where they had accepted a pension less favourable than gratuity.  Facts of the matter are that the appellant employees who worked for Mukundi plastics and Bevpak later as a going concern got to their respective retirement ages.  At that stage they each received their dues upon retirement including receipt of a pension from the pension fund to which they contributed until 2008.

For the 2008 to 2013 stretch the respondent employer paid them gratuity as during that period there were no remittals to the pension fund.  The operation and/or payment of a pension or gratuity was controlled by Section 29 of the Collective Bargaining Agreement of the Soft Drinks Manufacturing Industry SI 138/00.  This Instrument provided among other issues that the employer could contribute to a pension fund from which an employee could benefit upon retirement, death etc.  Part of the section provided that if the pension payable is less favourable than gratuity then the employer had to pay the employee gratuity instead.  After the appellants accepted the pension payment up to 2008 they realized that it was less favourable than gratuity payable using the model of calculation applicable or the relevant industry.

To that extent they approached the respondent asking to be paid gratuity for that period since the pension was less favourable than the pension.  Their matter went for arbitration where the arbitrator ruled that the appellants’ claim was not valid.  The argument used by the arbitrator in dismissing the claim was that the appellants could not claim gratuity and pension at the same time as this was against the spirit of the SI 138/00.  She also reasoned that since the appellant had accepted the “lower” pension payout they could not go back and pray for further payment for the whole stretch of their working life time.

Aggrieved by the dismissal of the claim the appellants have now appealed to this court against that arbitration award and this is the subject matter of this judgment.  The only issue falling for decision in this matter is whether the arbitrator correctly or wrongly interpreted Section 29 of SI 138/00 hence denying appellants gratuity which they were legally entitled to claim.

The appellants’ main argument is that in view of the fact that appellants were in continuous service with their employer that gratuity had to stretch as far back as the period covered by the pension which they received.  This argument is premised on the fact that the pension scheme in question provided the appellants benefits which were less favourable than what they would have gotten had their gratuity been properly calculated for the entire duration of their employment period including the period they used to be under Mukundi Plastics.

In response to the appeal the respondent argued that a literal interpretation of Section 29 of SI 138/00 can only lead to the conclusion that the mischief behind that provision was to cater for the employee in the form of pension or gratuity where there is no pension scheme in place.  To that extent respondent argued that appellants could not benefit from the pension fund and at the same time claim gratuity as that would be tantamount to double dipping.

Respondent argued further that even if it was to be held that appellants were indeed entitled to claim gratuity they waived such a right upon their receipt and acceptance of the pension benefit over the pre 2008 period when they were still under Mukundi.

All the facts of the matter are essentially common case and the only triable issue is the interpretation of Section 29 which is the pivot of the appellants’ argument.  In essence it deserves no restatement to mention that appellants enjoyed continuous service under the two employers and that they had entitlement to pension or gratuity.

A reading of section 29 of SI 138/00 speaks to the fact that a pension or gratuity are payable to an employee. Where the pension is less favourable an employee may be paid gratuity.  In the courts view it was not the intention of the drafters of the Code to have a party claim both gratuity and pension for the same served period.

It is clear from the facts that the period when no pension contributions were remitted the employer paid up gratuity for that as essentially there was no pension cover for that period.

As regards the period when a pension was in place, the appellants got paid by the fund.  The court thus fails to appreciate how the appellants can want to benefit from the gratuity for the same period.  The court is persuaded by the respondent’s argument and quoted case law on the appellants’ waiver of their rights to that extent.  In the result the court finds no fault with the interpretation given by the arbitrator to Section 29.

To that extent appeal is not merited and it should accordingly fail.

IT IS ORDERED THAT

Appeal being without merit it be and is hereby dismissed.

Each party to bear its own costs.

MTETWA & NYAMBIRAI, Respondent’s legal practitioners